An earn out agreement is a contractual agreement between the buyer and seller of a business that states that the seller will receive future payment(s). A seller also needs to separate its right to an earnout from the severance provisions of its employment agreement with the buyer.What is an Earnout Agreement? ​​An earnout agreement, also referred to as an earn-in or earn-out, is a type of acquisition payment structure. Earnouts are payments the seller receives if certain performance milestones are reached. 2. Situations when an earnout might be appropriate. 3.